Gauhati High Court
State Of Arunachal Pradesh And Ors. vs Nefa Udyog And Ors. on 19 July, 2006
Equivalent citations: 2007(1)GLT515
Author: I.A. Ansari
Bench: I.A. Ansari
JUDGMENT I.A. Ansari, J.
1. By this Common judgment and order, the four review petitions are being disposed of, for, all the four review petitions involve identical facts and common questions of law for determination. However, for the purpose of clarity and with the object of avoiding independent discussion of the facts of each of the writ petitions, which have given rise to the present set of review petitions, the review petition No. 116/2003, which has arisen out of the judgment and order, dated 27.01.2003, passed in WP(C) No. 458 (AP)/2001, is taken up for discussion and decision.
2. The foundation of the judgment and order, dated 27.01.2003, passed in WP(C) No. 458 (AP)/2001, lies in an application made under Article 226 of the Constitution of India by the opposite party to the present review petition seeking issuance of writ(s) commanding the present applicants (as respondents in the writ petition) to release the outstanding bills of a sum of Rs. 5,67,121/- due to the opposite party No. 1 herein, namely, M/S Nefa Udyog Ltd., for supply of sawn timbers to the Public Works Department, Arunachal Pradesh, for construction of Capital Complex at Itanagar.
3. Upon hearing the learned Counsel for the parties, this Court held, in its judgment and order, dated 27.01.2003, aforementioned to the effect, inter alia, that the State respondents had not paid to the writ petitioners the outstanding dues of Rs. 5,67,121/- without justified reasons. Instead of assigning afresh reasons as to why this Court came to such a conclusion, appropriate it is that the respective cases of the parties, as set up in the said writ proceeding and the reasons for the conclusion reached therein, be reproduced. With this object in view, relevant portions of the judgment and order, dated 27.01.2003, aforementioned are quoted herein below:
2. In a nutshell, the case of the petitioners runs as follows: The petitioner No. 1, namely, M/s Nefa Udyog, a registered partnership firm, is a Small Scale Industry located at Banderdewa and this Industry stands registered with the Department of Industry, Government of Arunachal Pradesh, since 08.01.1975. The petitioner No. 1 holds a licence issued by the Secretary, Department of Forests, Government of Arunachal Pradesh, for running a Saw mill at Banderdewa and the petitioner Nos. 2 and 3 are partners of the said firm. The petitioner's firm is a small-scale industry, which makes sawn timbers and other building materials. In the year 1973, when the work of the Capital Complex, at Itanagar, was started, the petitioners, on the orders placed by the Public Works Department, Government of Arunachal Pradesh, supplied sawn timbers from time to time to the various Divisions and sub-Divisions of the said department for construction of buildings and bridges. On receipt of the work orders/supply orders for the sawn timbers required, the petitioners firm used to make required sawn timbers ready in their saw mill and the same used to be collected by the representatives of the Sub-Division or Division concerned in their departmental truck from the premises of the said Mill. Before taking delivery of the sawn timbers, the representatives of the respondents used to inspect and measure the same, they used to record the requisite particulars in the challan book and take delivery of the said timbers by putting their signatures on the challan (i.e. credit memo). The Range Forest Officer used to issue, after verification, transit permits and on the basis of the permits so obtained, the representatives of the department concerned used to carry the timbers in their Departmental truck. The petitioners used to prepare their bills and submit the same to the Junior Engineers concerned and after verification, thereof, the Junior Engineers used to forward the bills, so raised, to the Sub-Division and the Division concerned for making payment to the petitioner. For the supplies so made, bills raised by the petitioners are lying unpaid with the respondents since 07.09.1992. The petitioners made several representations seeking payment of their dues, but despite assurances given by the respondents and their representative, the bills were not paid. The total amount of bills pending with the respondents, in this regard, is given, in detail, in Annexure-B to the writ petition. In fact, on the representation made to the Commissioner/Secretary, Public Works Department, Government of Arunachal Pradesh, seeking payment of the said outstanding dues, the authority aforementioned issued a letter, dated 11.03.1994 (Annexure-F to the writ petition) directing the Chief Engineers concerned to make payment of the outstanding dues of the petitioners. It was further directed by this letter that the defaulting offices should be served with show-cause notices for making delay in releasing payments. The payments were, however, not made and on repeated representations made by the petitioners seeking payments of their pending bills, the respondent No. 4 eventually admitted, vide his letter, dated 07.05.1998 (Annexure-H to the writ petition), that an amount of Rs. 5,67,121/- was lying outstanding with the respondents, but due to shortage of budget grants, the dues could not be cleared. Left with no alternative, the petitioners have approached this Court seeking relief/reliefs as hereinabove indicated.
3. The respondents have contested this case by filling their affidavit-in-opposition, their case being, in brief, thus: It is fact that the petitioners have supplied sawn timbers to the respondents from time to time. The acknowledgement by the respondents of the claims made by the petitioners is also correct, but the payment could not be released, because there was no fund or LOC available. However, supporting documents are required to be seen before accepting the claims. The petitioners are also required to furnish proof of royalty/monopoly having been paid to the Forest department for lifting timbers, in question. The petitioners have made huge supply of timbers to the government departments and they must have exceeded the turn over of rupees one crore, hence, M/s Nefa Udyog cannot really be treated as a SSI unit.
4. Reacting to the above affidavit-in-opposition filed by the respondents, the petitioners have filed their affidavit-in-reply, the father case of the petitioners, set up in the affidavit-in-reply, being, briefly stated, thus; asserted that M/s Nefa Udyog is a duly registered SSI unit and as per the prevailing procedure for lifting of timbers from the Forest Department, the timbers and other forests produces can be lifted only after clearing royalty and it is only upon receiving payment of royalty that the transit permits are issued by the Forest Ranger. In the case at hand, the petitioners have lifted timbers only upon making payment of royalty and after obtaining requisite transit-permits. This apart, the concerned Range Officer of the department concerned has already certified, vide his letter, dated 25.10.2002 (Annexure-2 to the affidavit-in-reply) that as per prevailing procedure, the timbers and other forest produces are removed only after clearing full and final royalty payment. After institution of this writ petition, the respondent No. 4, vide his letter dated 14.08.2002 (Annexure-3 to the affidavit-in-reply) asked the petitioners to send their representatives to the office of the respondent No. 3 for settlement of the pending dues and, upon verification, the respondent No. 4 has issued a statement (Annexure-4 with affidavit-in-reply) showing Rs. 19.46 lakhs due to be paid to the petitioners for three(3) divisions of Public Works Department, namely, Capital Division-A, Capital Division-B and Naharlagun Division. This apart, the Divisional Forest Officer, Banderdewa Forest Division, has also issued a certificate, dated 28.02.2002, to the effect that M/s Nefa Udyog, an authorized world based industry has made full and final payment of royalty monopoly and nothing is lying outstanding against the timbers lifted by them. The petitioners, therefore, need to be paid their dues with interest as has been prayed for by them.
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11. Let me, now, deal with the merit of the rival submissions made before me on behalf of the parties. What is of utmost importance to note, in this writ petition, is that the respondents have not clearly denied, in their affidavit-in-opposition, that the amount of Rs. 5,67,121/-, which the petitioners, have claimed as outstanding dues against the sawn timbers supplied to the respondents concerned, is correct. This apart, the respondent No. 4 has, vide Annexure-H to the writ petition, admitted that the amount of Rs. 5,67,121/- was lying outstanding in favour of the petitioners. In fact, in para 14 of their affidavit-in-opposition, the respondent have clearly stated, "The fact of acknowledgment of claims as mentioned in the letter No. CD-NA-2/6/98-99/86-88, dated 14.05.1998, are correct as per list of claims submitted by M/s Nefa Udyog. The payment would have been released, had there been fund and LOC". The averments so made in para 14 of the affidavit-in-opposition constitute clear admission of the aforesaid dues of the petitioner. It is also not in dispute before me that the unpaid bills of, the petitioners are in respect of sawn timbers, which the petitioners had supplied to the department concerned, and that the timbers, so supplied, have been utilized by the respondents.
12. Coupled with the above, it transpires from the affidavit-in-reply of the petitioners that even after institution of the writ petition, the respondent No. 3 has, upon verification, clarified that the amount aforementioned is, indeed, pending unpaid with the respondents.
13. In the face of the above materials on record, there can be no escape from the conclusion that an amount of Rs. 5,67,121.00 is lying outstanding with the respondents for the sawn timbers supplied to them by the writ petitioners.
14. Turning to the question as to whether the petitioners have paid the royalty/monopoly to the forest Department for the timbers lifted by them, it is of immense importance to note that the petitioners have clearly stated in their affidavit-in-reply that as per the prevailing procedure, a forest produce can be removed only after making payment of royalty. The averment so made by the petitioner is fully supported by the certificate, dated 25.10.2002 (Annexure-2 to the affidavit-in-reply) inasmuch as in this letter, the Range Forest Officer, Banderdewa Forest Range, has clarified that as per the prevailing practice, payment of royalty/monopoly has to be made before lifting forest produces including timber.
15. What logically follows from the above is that before lifting timbers, the petitioners must be teated to have paid the royalty/monopoly. This apart the letter, dated 28.10.2002, aforementioned of the Divisional Forest Officer, Banderdewa Forest Division, clearly shows that M/s Nefa Udyog, a wood based industry, has paid full and final royalty/monopoly and no amount is lying outstanding against them for the timbers lifted by them.
16. In the face of the above materials on record, the mere assertion of the respondents that it has to be verified whether the royalty have been paid by the petitioners to the Forest Department before lifting the timbers in question can be given no credence at all, particularly, when the dues have been kept pending since 07.09.1992 and no clear allegation has been made till today that any dues in respect of royalty/monopoly are pending against the petitioners for the sawn timbers lifted by them.
17. Now, coming to next contention of the respondents that the petitioners might have exceeded turn over of rupees one crore annually for the timbers supplied by them, suffice it to mention here that such a vague statement can be attributed no importance at all inasmuch as the respondents have not submitted any materials on record, to show that the turn over of income of the petitioners, during the relevant period, was more than that of a 551 unit. This apart, the petitioners have already produced before this Court the certificate of registration of M/s Nefa Udyog as a SSI unit. This certificate shows that the petitioner No. 1 is a 551 unit, which stood registered with the Department of Industry, Govt. of Arunachal Pradesh, since the year 1975 and the petitioner No. 1 has been supplying sawn timbers as a small scale industry.
18. What crystallizes from the above discussions is that the respondents have not paid the dues of Rs. 5,67,121/- without any justified reasons. The plea of the respondents that funds were not available with them for making payment of the dues of tile petitioner can be of no avail to the respondents. In the face of the facts so established, this Court has to, now, decide as to what relief/reliefs can be granted to the petitioners.
4. The conclusions reached above, it may be noted, could not be assailed in the present review petition. In fact, not even an attempt has been made by the review petitioners to confidently assert that on the basis of the pleaded case of the parties, respondents were not liable to pay to the writ petitioner the dues of Rs. 5,67,121/-.
5. Having, in the light of the above findings, considered the question of relief(s) to be granted to the petitioners, this Court, in its judgment and order, dated 27.01.2003, aforementioned, concluded and directed as quoted hereinbelow:
25. In view of the fact that the petitioners have successfully shown that the petitioner No. 1 is a Small Scale Industry duly registered with the Department of Industry, Government of Arunachal Pradesh, and that for the supplies of sawn timbers made by the petitioners to the respondents from time to time, an amount of Rs. 5,67,121/- had been kept outstanding by the respondents despite repeated demands made by the petitioners, there can be no escape from the conclusion that the respondents are liable to pay interest on the said unpaid dues/as per provisions of the said Act, since after coming into force of the said Act. This apart, the petitioners are also entitled to receive interest at such rates as this Court may deem reasonable to impose on the said outstanding amount of Rs. 5,67,121/- with effect from 07.09.1992, i.e., the date, when the last bill was raised by the petitioners till the date, when the said Act came into force.
26. Considering, therefore, the matter in its entirety, the respondents are hereby directed to pay to the petitioners the admitted amount of Rs. 5,67,121/- with interest at the rate of Rs. 12/- per cent per annum with effect from 07.09.1992, i.e., the day on which the last bill was so raised, till 23.09.1992, i.e., the date, when the said Act came into force. The respondents shall also pay to the petitioners interest on the said amount of Rs. 5,67,121/- at the rate of one- and-a-half time of the Prime Lending Rate charged by the State Bank of India with effect from 23.09.1992 (i.e., the date when the said Act came into force) until the time the said dues are totally cleared. It is further directed that the respondents shall clear the dues aforementioned with interests as aforementioned within a period of three months from today.
6. Feeling aggrieved by the judgment and order, dated 27.01.2003, aforementioned, the respondents to the writ petition preferred an appeal on 20.08.2003, i.e., after a delay of about 175 days. The appeal came to be registered as Writ Appeal No. 372/2003. This Writ Appeal was, however, disposed of by a Division Bench of this Court, on 04.12.2003, on the appeal being withdrawn by the appellants without, however, obtaining any leave. Thereafter, the present review petition along with three other such review petitions was filed, on 11.12.2003, (i.e., after a period of about 287 days). All the four review petitions were dismissed by an order, dated 09.06.2004, on the ground that the appeal having been withdrawn without obtaining leave, the judgment and order, dated 27.01.2003, aforementioned, passed in the said four writ petitions, stood merged into the appellate order, dated 04.12.2003, aforementioned and this Court is debarred by law to review its own judgment and order, dated 27.01.2003, aforementioned.
7. The review petitioners, thereafter, carried the matter to the Apex Court by way of Special Leave Petition. By order, dated 01.10.2004, passed, in Civil Appeal Nos. 6551-6555 of 2004, the Apex Court disposed of the matter with the following observations and directions:
By consent of the parties, the impugned orders are set aside. The matter is remitted back to the High Court. The High Court shall consider the Review Petitions on their merits without being influenced by the fact that the Appeal had not been pressed. The Appeals stand disposed of. There will be not order as to costs. Till the disposal of the Review Petitions, further payment is stayed.
8. It is in the background of the above facts and the orders aforementioned that this review petition has been taken up for hearing alongwith the order three review petitions.
9. I have heard Mr. CKS Baruah, learned Advocate General, Arunachal Pradesh, appearing on behalf of the writ respondents-review petitioners, and Mr. KN Choudhury, learned Senior Counsel, appearing on behalf of the writ petitioner-opposite party.
10. It is contended by the review petitioners that holding of a permanent registration certificate, as a Small Scale Industry, is a condition precedent for attracting the provisions of the Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993 (in Short, 'the Act of 1993') and the writ petitioners committed fraud by deliberately suppressing from this Court that they were not holding a permanent registration certificate and that their application for permanent registration certificate had not been acceded to by the Department of Industries, Govt. of Arunachal Pradesh. It is also contended by the review petitioners that since holding of a permanent registration certificate is a condition precedent for attracting the provisions of the Act of 1993, the directions given by judgment and order, dated 27.01.2003, aforementioned to the review petitioners to make payment of the dues of the opposite party with interest in terms of the provisions of the Act of 1993 is an error apparent on the face of the record and may, therefore, be reviewed. It is further contended by the review petitioners that a writ proceeding is not maintainable for obtaining relief of interest in terms of the provisions of the Act of 1993 and, hence, the entertaining of the writ petition, in question, and also giving of the relief of interest, in terms of the provisions of the Act of 1993, in favour of the writ petitioner, is an order suffering from error of jurisdiction apparent on the face of the record and may be reviewed accordingly.
11. Controverting the submissions made on behalf of the review petitioners, it is pointed out, on behalf of the writ petitioners, that the review petitioners have been taking inconsistent pleas and making contradictory accusations in order to, somehow or other, wriggle out of the liability, which, the directions given in the judgments and orders, sought to get reviewed, impose on the review petitioners. In this regard, it is pointed out that in the affidavit-in-opposition as well as in the writ appeals, the stand of the review petitioners was that the SSI registration certificate of the writ petitioner was not for supply of sawn timber, but for supplying of logs and for making household furniture, etc. In the review petition, submits Mr. K.N. Choudhury, learned Senior counsel, the stand taken by the review petitioners is that the SSI registration certificate granted to the writ petitioner was a provisional one and, hence, the writ petitioner was not entitled to the benefit of interest on delayed payment as envisaged under the Act of 1993. In contrast to both these shifting stands, which the writ respondents had taken, their stand, in the Special Leave Petition, points out Mr. K.N. Choudhury, was that the SSI registration, which the writ petitioner sought to establish, was a false and fake one. In the light of such vacillating stand, contends Mr. Choudhury, it cannot be said that the review petitioners have any substance, when they submit that subsequent to the passing of the judgment and order, dated 27.01.2003, aforementioned, certain facts have come to light, which could not be discovered earlier despite exercise of due diligence by the review petitioners.
12. From the rival submissions made on behalf of the parties, it becomes abundantly clear that the review of the judgment and order, dated 27.01.2003, has been sought on three grounds, namely, that the writ petitioners have obtained directions for payment of interest by committing fraud on this Court, the writ petitioners were not entitled to payment of interest in terms of the provisions of the Act of 1993 and that in a writ proceeding, direction for payment of interest in terms of the provisions of the Act of 1993 cannot be given, for, the Act of 1993 is applicable to civil suits only and not to any other proceeding, such as a writ proceeding.
13. Bearing in mind the rival submissions made before me on behalf of the parties concerned and the three distinct grounds on which the review is sought, the present review petitions need to be dealt with.
14. Let me, first, deal with the question as to whether in the face of the facts, which emerge from the materials on record, the writ petitioners were entitled to the relief of interest on delayed payment in terms of the Act of 1993?
15. While dealing with the above question, it may be noted that it is pointed out, on behalf of the review petitioners, that the interest, as envisaged under the Act of 1993, has been made available by the Act to only such persons, who can be described as suppliers within the meaning of Section 2(f) of the Act of 1993, and for the purpose of being a supplier, the person, who seeks the application of the Act of 1993, must satisfy the Court that he holds a permanent registration certificate as a Small Scale Industrial Undertaking. The review petitioners contend that the writ petitioner does not fall within the meaning of the word 'supplier' and, hence, the provisions of the Act of 1993 ought not to have been applied to the case of the review petitioners.
16. For the purpose of ascertaining the correctness of the above submissions, Section 3, which makes a buyer liable to make payment of interest in terms of the Act of 1993, needs to be taken note of and is, therefore, reproduced hereinbelow:
3. Liability of buyer to make payment: where any supplier supplies any goods or renders any services to any buyer, the buyer shall make payment therefor on or before the date agreed upon between him and the supplier in writing or, where there is no agreement in this behalf, before the appointed day:
(provided that in no case the period agreed upon between the supplier and the buyer in writing shall exceed one hundred and twenty days from the day of acceptance or the day of deemed acceptance.)
17. A careful reading of the provisions of Section 3 makes it clear, as correctly contended by the review petitioners, that the interest on delayed payment is available to only that person, who, as a supplier; supplies any goods or render any services to any buyer. According to Section 2(f) of the Act of 1993, 'supplier' means, an ancillary industrial undertaking or a small scale industrial undertaking holding a permanent registration certificate issued by the Directorate of Industries or a State (or Union Territory) and includes-(i) the National Small Industries Corporation being a company, registered under the Companies Act, 1956, and (ii) the Small Industries Development Corporation of a State or a Union Territory, by whatever name called, being a company registered under the Companies Act, 1956.
18. What is, now, of paramount importance to note is that the word permanent registration certificate has not been defined in the Act of 1993. Necessary, therefore, it is that one looks into the developments in the realm of Small Scale Industrial Undertakings, which led to the concept of permanent registration certificate vis-a-vis the case of the writ petitioners.
19. While considering the above aspect of the matter, what may be noted is that the Circular No. 4(1)/75-SSI.Bd, dated 20.01.75, issued by the Development Commissioner (Small Scale Industries), Ministry of Industry & Civil Supplies, Govt. of India, indicates that on conducting a preliminary analysis of the data collected during the census of Small Scale Industries, Govt. of India noticed that the system of voluntary registration, introduced in the early sixties in respect of Small Scale Industrial units, has not been uniform and that the registrations were mainly aimed at maintaining statistics. Government of India, therefore, issued necessary guidelines with regard to the procedure for registration of the SSI Units all over the country.
20. The revised procedure for registration of SSI Units, as introduced by Annexure-A to the Govt. of India's Circular No. 4(1)/75-SSI.Bd, dated 20.01.75, aforementioned, ran as follows:
"REVISED PROCEDURE FOR REGISTRATION OF SMALL SCALE INDUSTRY:
The registration of small scale units should be done in two stages viz. (a) Provisional registration and (b) registration.
(a) Provisional Registration Provisional Registration is to enable a party to take the necessary steps to bring the unit into existence. It should, after providing satisfactory proof of the unit having come into existence, be converted into a regular registration later.
A provisional registration should be valid for six months and may be renewed for a further period of six months on submission of satisfactory proof that the party is taking active steps to establish the unit but could not complete the same.
Provisional registration may be given at the District/RIP Area level.
The issue of a Provisional registration certificate normally should be automatic and should be given within a period of seven days after receipt of the application unless the proposed industry is one which needs raw materials which have been declared as non-available to new units because of their acute scarcity. The Development Commissioner, Small Scale Industries will, from time to time, circulate the list of industries for which raw materials are in acute short supplies, (b) Registration When the party has taken all steps to establish the unit, i.e., where the factory, building is ready, power connection is given, the machinery has been installed, he may apply for registration of the unit.
Within seven days of the receipt of application, the District Industries Officer or other designated officer should inform the party of the date and time for inspection of the unit. The inspection should include an assessment of the installed capacity of the unit. On being satisfied that the unit is capable of production activity, a registration certificate may be issued by the Directorate of Industries.
All registered units should submit half-yearly reports of the raw materials received/utilized, stocks on hand/production and sales to the Directorate of Industries in triplicate. Failing to submit such returns within the prescribed period may constitute adequate ground for refusing to sponsor applications for import/allocation of raw materials.
The Director of Industries should maintain a list of all registered small scale units at his headquarters office. Each D10 will have a similar list of units registered within his district. A half-yearly summary of the newly registered units should be forwarded by the Director of Industries to the DC (SSI) by end of November and end of May for the half years ending 30th September and 31st March respectively.
21. From a careful reading of the Circular, dated 20.01.75, aforementioned, it transpires that what the revised procedure for registration of SSI Units envisaged was that registration of the SSI Unit would be done in two stages, namely, (i) provisional registration and (ii) registration. In this Circular, the word permanent registration was, nowhere, used. Provisional registration, as the Circular, dated 20.01.75, aforementioned reveals, was meant to enable a party to take necessary steps to bring his SSI Unit into existence and after the party concerned satisfactorily showed that its SSI Unit had come into existence, provisional registration was to be converted into final registration. The Circular, dated 20.01.75, aforementioned also reveals, that under the revised procedure when a party had taken all steps to establish the unit, namely, (as explained vide the Circular, dated 20.01.75, itself) where the factory building was ready, power connection was given, machinery had been installed, the party concerned could have applied for final registration of the unit. This revised procedure also envisaged that within seven days of the receipt of the application, the District Industries Officer should inform the party about the date and the time of inspection of the unit and the inspection was to include the assessment of the installed capacity of the unit. On being satisfied that the unit was capable of production activity, a registration certificate was to be issued by the Directorate of Industries.
22. As noticed above, the revised procedure, therefore, envisaged the registration of units in certain specified circumstances stipulated therein. It is the writ petitioner's case that since its unit had been an on-going unit and it already stood engaged in its production activity for the last 12 years commencing from the year 1963, it was registered, on 06.01.75, and allotted registration No. IND-8 and since this registration was not a provisional registration, the word provisional was, nowhere, used, while granting the said registration to the writ petitioner's Unit. To contradict these assertions of the writ petitioner, the review petitioners have not been able to produce anything on record to show that the registration granted to the writ petitioner, on 06.01.75, was provisional in nature. It is in this backdrop of facts that the Government of India's further policy to revise the registration certificates of SSI Units needs to be taken note of.
23. Moreover, what the Circular, dated 20.01.1975, aforementioned reflects, if I may repeat, is that according to the Govt. of India's procedure introduced, on 20.01.75, there were only two kinds of registration in respect of SSI Units, namely, provisional and final.
24. In fact, the Government of India's revised procedure, introduced by Annexure-A aforementioned, gave absolutely no indication that the 'final registration' granted should mention 'final registration'. Far from this, what the revised policy, dated 20.01.1975, aforementioned, indicated was that there shall be a provisional registration and after the party has taken all steps to establish the unit, it would be registered by the Director of Industries. Viewed thus, it is clear that if a functional unit was granted registration without indicating that the registration was provisional in nature, registration would be deemed to be a final one.
25. The expression permanent registration or permanent registration certificate, in respect of SSI Units, had not even been coined in the year 1975.1 may pause here to point out that though at one stage, the review petitioners had denied that the writ petitioner had been registered as a SSI Unit, the admitted facts, which finally emerge, show that the writ petitioner No. 1 was, admittedly, registered as a SSI Unit under registration No. IND-8, dated 06.01.75, issued by the competent authority of the State of Arunachal Pradesh.
26. It, now, needs to be carefully noted that though it has been contended, in the review petition, by the review petitioners that the registration granted to the petitioner's Unit was a provisional one and since the same was not made permanent after five years, i.e., in the year 1980, it cannot be regarded as a permanent Unit, what cannot be ignored is that the review petitioners, for this purpose, rely on the Circular No. 5(1)/92-SSI Bd, dated 20.07.92, issued by the Department of SSI, Agro & Rural Industry, Ministry of Industry, Govt. of India. This letter shows that the Government of India further revised its guidelines with regard to the procedure for registration of SSI Units and it is under the Circular, dated 20.07.92, aforementioned, that the expression permanent registration appeared, for the first time, in respect of SSI Units. It is also worth noticing that even under the Circular, dated 20.07.92, aforementioned, the expression permanent registration certificate had not been used and, as would be shortly noticed, the expression permanent registration certificate was introduced, for the first time, in the year 1993.
27. Be that as it may, under the heading 'Permanent Registration', the Circular, dated 20.07.92, aforementioned, stated thus, III. PERMANENT REGISTRATION: Once the entrepreneur complete all the formalities indicated at the time of issue of PRC as indicated above, the unit has commenced or is ready to commence production, the registration of such SSI units on permanent basis should be automatic. It should be ensured that permanent registration in all cases is issued within 30 days from the date of receipt for proposal from entrepreneur.
28. What is, however, of utmost importance to note is that the Government of India's said Circular, dated 20.07.92, nowhere, indicated that those SSI Units, which were already functioning as SSI Units on permanent basis and were not provisional ones, were to be issued, once again, any certificate of registration, in the form of permanent registration, in terms of the said Circular, dated 20.07.1992. In fact, permanent registration, as the Circular, dated 20.07.92, reflects was meant for registration of those SSI Units, which were, either, on 20.07.92, provisionally registered as SSI Units or were to come into existence after the issuance of the letter, dated 20.07.92, aforementioned.
29. Thereafter, the Circular No. 5(1)/93-SSI Bd, dated 16.09.93, was issued by the Ministry of Industry, Department of Small Scale Industries & Agro Rural Industries, Government of India. This letter read as under:
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2. *** *** ***
3. The issue of the validity and renewal of the provisional registration certificate (PRC) came up for discussion during the State Industry Ministers' Conference held on 7th June, 1993. In accordance with the recommendations of the above stated Conference, it has now been decided as follows:
i. The Provisional Registration Certificate (PRC) will be valid for a fixed period of 5 years from the date of issue of PRC. In other words, the PRC will automatically lapse at the end of 5 years from the date of issue of the certificate or the date of commencement of production by the unit, whichever is earlier. It may be noted that the PRC is valid only for the pre-operative period of the unit. That is, as soon as the unit commences commercial production the provisional registration certificate loses its validity.
ii. Hence the Registration authority i.e. the General Manager, District Industries Centre will grant the PRC for a fixed period of 5 years. There will, therefore, be no need for the extension of the PRC by the DIC or by the Directorate of Industries at the Regional/State level or the Office of the Development Commissioner (SSI).
iii. Since the PRC will be for a fixed period of 5 years, there will be no question of its extension beyond the fixed period of 5 years. An applicant who is unable to set up until within the allowed period of 5 years will have the option applying afresh to obtain a new PRC using standard procedures.
30. On a minute reading of the Circular, dated 16.09.93,1 notice that it is under this Circular that for the first time, it was made clear that provisional registration certificate will be valid for a fixed period of five years from the date of issue of the Provisional Registration certificate. The concept, which was introduced by the Circular, dated 16.09.93, was prima facie not applicable to the case of the writ petitioners' Unit, when the same was granted registration in the year 1975. On the basis of the Circular, dated 16.09.93, it cannot be contended that the registration for the writ petitioner's Unit was, a provisional one.
31. In fact, until the time the Circular, dated 16.09.93, aforementioned, was issued, it was the Circular, dated 20.07.92, held the field and in terms of this policy letter, dated 20.07.92, once the entrepreneur had completed all the formalities and had either commenced production or was ready to commence production, registration of the Unit was to be automatic on permanent basis.
32. It has been contended by the review petitioners, in the review petition, for the first time, that the writ petitioner was never granted permanent registration as a SSI Unit and what was granted, in the year 1975, by the Directorate of Industries, Govt. of Arunachal Pradesh, was a provisional registration certificate, which expired after five years, i.e., in the year 1980. It has been, as already mentioned hereinabove, the case of the review petitioners that the fact that the writ petitioner was provisionally registered as a SSI Unit and had no permanent registration, in this regard, was deliberately suppressed by the writ petitioner. It is also the case of the review petitioners that the fact that the writ petitioner's registration, as a SSI Unit, was a provisional one came to light only after the judgment and order, dated 27.01.2003 (which is sought to get reviewed) was delivered. In this regard, what is of utmost importance to note is that the writ petitioner's assertion that the saw mill, in question, was established in the year 1963, in terms of the licence issued by the then North-Eastern Frontier Agency Administration, is not in dispute and its certificate of registration, bearing No. IND-8-75, nowhere, mentions that the registration of unit concerned, as a SSI Unit, is a provisional one.
33. If the history of development and registration of SSI Unit, as analysed hereinabove, are dispassionately taken into account, it clearly transpires that a SSI Unit is either a provisional unit or a unit, which is registered on permanent basis.
34. Can, in the circumstances, as indicated hereinabove, the Act of 1993 be treated to have denied the benefit of interest, on delayed payment to those SSI Units, which already stood registered on permanent basis, long before the Circular, dated 20.07.92, and/or the Circular, dated 16.09.93, aforementioned came into existence? My quest for an answer to the above question brings me to the objects and reasons for enactment of the Act of 1993.
35. For the purpose of appreciating the objects with which the Act of 1993 was enacted, pertinent it is to take note of the statement of objects and reasons for the Act of 1993, which read as under:
STATEMENT OF OBJECTS AND REASONS A policy statement on small scale industries was made by the Government in Parliament. It was stated at the time that suitable legislation would be brought to ensure prompt payment of money by buyers to the small industrial units.
2. Inadequate working capital in a small scale or an ancillary industrial undertaking cause serious and endemic problems affecting the health of such undertaking. Industries in this sector have also been demanding that adequate measures be taken in this regard. The Small Scale Industries Board, which is an apex advisory body on policies relating to small scale industrial units with representatives from all the States, governmental bodies and the industrial sector, also expressed the view. It was, therefore, felt that prompt payments of money by buyers should be statutorily ensured and mandatory provisions for payment of interest on the outstanding money, in case of default, should be make. The buyers, if required under law to pay interest, would refrain from withholding payments to small scale and ancillary industrial undertakings.
3. An Ordinance, namely, the Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Ordinance, 1992, was, therefore, promulgated by the president on the 23rd September, 1992.
4. The Bill seeks to replace the said Ordinance and to achieve the aforesaid objects.
36. The object of the Act of 1993, if read carefully, clearly indicates that what prompted the Government of India to enact the Act of 1993 was its anxiety to save SSI Units from being closed down and financially ruined due to delay in the payment of outstanding dues by their buyers and to ensure prompt payment of money to SSI Units by buyers of the products of the SSI Units so as to make them survive. If such be the object of the Act of 1993 and when there is nothing in the Circular, dated 20.07.92, aforementioned to show that those SSI Units, which had already been registered on permanent basis in terms of the Circular, dated 20.01.1975, or prior thereto, were to be, once again, treated as provisionally registered SSI Units and were to be granted registration certificate by using the terms permanent registration or 'permanent registration certificate', it becomes abundantly clear that if the definition of supplier, appearing in Section 2(f), has to have any meaningful purpose, it must be held that the expression 'permanent registration certificate', occurring in Section 2(f), would mean such SSI undertakings, which have been registered, on permanent basis, with the Director of Industries of a State or Union Territory. If such interpretation is not attributed to Section 2(f), which defines supplier, the consequence would obviously be that those SSI Units, which had already come into existence prior to 20.01.75 or 20.07.92, would be placed outside the purview of the Act of 1993. By no process of reasoning, such an exclusionary provision can be imported into meaning of the word 'supplier' contained in Section 2(f). The impact of such exclusion of those SSI Units, which had been functional, on permanent basis, prior to 20.07.1992 and/or 16.09.1993, would be devastating, highly arbitrary and also discriminatory. Such shall, ordinary, not, and in the present case, does not appear to be the legislative intent.
37. To put it differently, Section 2(f) needs to be given purposive interpretation that a 'supplier' would mean an ancillary industrial undertaking or a small scale industrial undertaking, which stands registered with the Director of Industries of a State or Union Territory, on permanent basis. If the writ petitioner's unit is considered in this light, it becomes clear that the writ petitioner was a supplier within the meaning of Section 2(f) of the Act of 1993, when it had made supplies of materials, as SSI Unit to the PWD, Govt. of Arunachal Pradesh, in the year 1973, when the work of the Capital Complex, at Itanagar, was in progress.
38. The conclusions, which I have reached above, if correct, do not permit any correction by way of review. If the view, which I have taken, is erroneous, it is still not possible to correct such an erroneous view by taking recourse to the power of review, for, the power of review is available to patent errors and not erroneous decisions. In Aribam Tuleshwar Sharma v. Aribam Pishak Sharma , the Supreme Court has emphasized that on the ground that the decision was erroneous on merit is not amenable to the power of review available to High Court. (See also Meera Bhanja (Smt) v. Nirmala Kumari Choudhury (Smt) ).
39. The principle is that a judgment pronounced by a Court is final and departure from such a principle is justified only when circumstance of a substantial and compelling character make it necessary to do so. One of the grounds for such permissible departure is when an error is apparent on the face of the record, that is, an error, which is so self-evident that it does not require long drawn process of reasoning to establish the error. An error, which is patent or apparent on the face of the record, has to be such an error, where there can be no two opinions. If, on a given subject, two views are conceivable possible, such an error cannot be corrected by taking recourse to the power of review nor can, in the guise of exercise of power of review, the Court, which had passed the earlier order, substitute its earlier view by a subsequent view. In short, on a given point, when there can be two reasonably possible views, such an error can be corrected only by an appeal and not under the power of review. Emphasized the Supreme Court in Parsion Devi and Ors. v. Sumitri Devi and Ors. , that there is a clear distinction between an erroneous decision and an error apparent on the face of the record. While the first can be corrected by higher forum, the latter only can be corrected by exercise of review jurisdiction.
40. In Thungabhadra Industries Ltd. v. The Government of Andhra Pradesh , the Supreme Court, speaking through N. Rajagopala Ayyangar, J., held, ...(there is a distinction which is real, though it might not always capable of exposition, between a mere erroneous decision and a decision which could be characterized as vitiated by "error apparent". A review is by no means an appeal in disguise whereby an erroneous decision is reheard and corrected, but lies only for patent error. We do not consider that this furnishes a suitable occasion for dealing with this difference exhaustively or in any great detail, but it would suffice for us to say that where without any elaborate argument one could point to the error and say here is a substantial point of law which stares one in the face, and there could reasonable be no two opinions entertained about it, a clear case of error apparent on the face of the record would be made out.
41. In the case at hand, since the view, which I have taken that the writ petitioner was a supplier within the meaning of Section 2(f) of the Act of 1993, is a view, which is possible to adopt, such a view cannot be called an error apparent on the face of the record, particularly, when the error, if any, in the present case, has to be established by a long drawn process of reasoning and is far from self-evident. An erroneous decision, if I may reiterate, can be corrected only in an appeal and the power of review cannot be exercised in the guise of an appeal. An error apparent on the face of the record is only an error, which is self-evident and there can be no two opinions that the view taken earlier was a wrong one. Clarified a three-Judge Bench of the Supreme Court, in Satyanarayan Laxminarayan Hegde and Ors. v. Mallikarjun Bhavanappa Tirumale , speaking through KC Das Gupta, J., that ...An error which has to be established by a long drawn process of reasoning on points where there may conceivably be two opinions can hardly be said to be an error apparent on the face of the record. As the above discussion of the rival contentions show the alleged error in the present case is far from self-evident and it can be established, it has to be established by lengthy and complicated arguments. We do not think such an error can be cured by a writ of certiorari according to the rule governing the powers of the superior court to issue such a writ.
42. In view of the fact that the expression 'permanent registration certificate', in respect of SSI Unit, appears only under the Circular, dated 16.09.1993, and the expression 'P.R.C., has not been defined in the Act of 1993, it cannot be confidently held that the writ petitioners have deliberately suppressed the fact that they did not have permanent registration certificate. This impression gets reinforced from the fact that the writ petitioners clearly stated, in their writ petitions, that they were registered as SSI Unit. Nothing had prevented the respondents from pointing out, when the writ proceeding was in progress, that the registration granted to the petitioner firm was not permanent in nature. When there is nothing on record to show that the registration granted, in the year 1975, to the writ petitioners' Unit was a provisional one, and when the writ petitioners case is that it had been a functional unit since 1963, it is well-nigh impossible to infer, far less confidently hold, that the writ petitioners have obtained the judgment and order, dated 27.01.2003, aforementioned, by playing fraud on this Court. In order to sustain its accusation that the writ petitioners had played fraud with this Court, review petitioners ought to have given requisite materials; but nothing, in this regard, has been pointed out or could be produced by the review petitioners to show that the writ petitioners had deliberately omitted to state, in their writ petition, that its Unit had no permanent registration certificate. The writ petitioners' case, as correctly put by Mr. K.N. Choudhury, learned Senior counsel, has never been that it possessed permanent registration certificate as a SSI Unit; rather, its case has always been that its Unit was registered as a SSI Unit as was obtaining at the relevant point of time.
43. In view of the fact that the review petitioners have not been able to make out any case of fraud having been committed by the writ petitioners on this Court, reference to the decisions in S.P. Chengalvaraya Naidu (Dead) v. Jagannath (Dead) and Ors. , and Lily Thomas and Ors. v. Union of India and Ors. , as made by the review petitioners, have no application to the facts of the present case. In other words, when I am satisfied that the review petitioners have miserably failed to make out any case of fraud having been played by the writ petitioners, mere reference to the decisions in S.P. Chengalvaraya Naidu (supra) and Lily Thomas(supra) can be of no avail to the review petitioners.
44. In support of their contention that a writ proceeding under Article 226 is not maintainable for the purpose of giving relief of interest in terms of the Act of 1993, the review petitioners have relied on the observations made in Assam Conductors Manufacturers Association v. The Assam State Electricity Board and Ors. reported in 1997(111) GLT 49, wherein a Division Bench of this Court observed and held thus:
By a careful consideration of the Act of 1993, specifically referring to the charging Section 4 of the Act including Section 6 dealing with recovery of the amounts due, arising out of the rate of interest required to be calculated and made payable under Section 4, we are clearly of the view that the language employed in Section 6 clearly says that any person entitled to recover the amounts due from a buyer under Section 6 of the Act, shall do so by way of a suit or other proceeding under any law for the time being in force, which means, generally we will have to construe that by referring to "suit or other proceeding", it necessarily means that the aggrieved person shall seek a remedy by way of a suit in a Civil Court.
(Emphasis is supplied)
45. It is noteworthy that in Assam Conductors Manufacturers Association (Supra), the conclusion of the Division Bench, if I may reiterate, is, ... generally we will have to construe that by referring to "suit or other proceeding", it necessarily means that the aggrieved person shall seek a remedy by way of a suit in a Civil Court.
(Emphasis is supplied)
46. A bare reading of what has been so observed, in Assam Conductors Manufacturers Association (supra), makes it clear that generally, an aggrieved person shall seek remedy by way of a suit in a Civil Court. The use of the word 'generally is of immense importance, for, by carefully using the word 'generally', the Division Bench has not ruled out, in Assam Conductors Manufacturers Association (supra), the possibility that in an appropriate case, an order for payment of interest, in terms of the Act of 1993, may be given in a proceeding other than civil suits and such proceedings would include a proceeding under Article 226 of the Constitution of India. This apart, in the present case, at the time of hearing of the writ petitions, it had not been raised by the review petitioner, who were respondents in the writ proceedings, that a writ proceedings is not maintainable under Article 226 for claiming relief of interest in terms of the Act of 1993.
47. Coupled with the above, when the conclusion reached by this Court was that the respondents, (i.e., the present review petitions) had outstanding dues to be paid to the writ petitioners and when this conclusion has not been challenged and when this Court has also concluded that the writ petitioners, in the facts and circumstances of the present case, fall within the definition of the term 'supplier', occurring in the Act of 1993,1 do not find that the granting of interest, on the said outstanding dues, in terms of the Act of 1993, is either a jurisdictional error or is an error apparent on the face of the record.
48. It may also be noted that in Brahmaputra Udyog Pvt. Ltd. v. The Chief Secretary to the Govt. of Assam, an order, issued, on 03.07.2001, by the State Government that payment of interest in terms of the Act of 1993, would be available in respect of only such supply orders, which are issued subsequent to the coming into force of the Act of 1993, came to be challenged by way of writ petition, which gave rise to WP(C) No. 6254/2001. The learned single Judge relying upon the Full Bench decision of this Court in Assam State Electricity Board and Ors. v. Shanti Conductors (P) Ltd. and Anr. reported in 2002 (1) GLT 547 set aside the order, dated 03.07.2001, aforementioned and directed payment of interest in terms of the Act of 1993 w.e.f. 23.09.1992. The decision of the learned Single Judge was challenged in Writ Appeal No. 280/2002. By judgment and order, dated 25.06.2002, a Division Bench dismissed the appeal and maintained the order. From this decision, it becomes clear that in an appropriate case, direction for payment of interest, in terms of the Act of 1993, may be made even in a writ proceeding and there is no absolute bar in entertaining a writ petition in a case, wherein outstanding dues of a supplier, within the meaning of the Act of 1993, has not been paid. In short, on the ground that a writ proceeding was not maintainable at all in the present case, the judgment and order, dated 27.01.2003, aforementioned cannot be reviewed.
49. What emerges from the foregoing discussions is that in view of the fact that the respondents have, as already pointed out above, admitted the claims of the writ f petitioners as their outstanding dues, it was not outside the powers of this Court to grant a writ in the nature of mandamus directing the writ respondents review petitioners to make payment of the dues of the writ petitioners with interest as are applicable under the Act of 1993.
50. Because of what have been discussed and pointed out above, I do not find that the review petitioners have been able to make out any case calling for review of the judgment and order, dated 27.01.2003, passed in the four writ petitions aforementioned.
51. In the result, and for the reasons discussed above, all the four review petitions fail and the same shall accordingly stand dismissed.
No order as to costs.